Iran 'playing with fire,' says Donald Trump

Washington: US President Donald Trump today accused Iran of "playing with fire" after the Islamic republic dismissed his warnings over its latest missile test as unfounded and provocative.

In a series of early morning tweets, Trump wrote: "Iran is playing with fire - they don't appreciate how 'kind' President Obama was to them. Not me!"

But that was only the second of five tweets fired off between 6:24 am (local time) and 6:48 am.

The first in the series concerned Trump's feud with Arnold Schwarzenegger and the rest covered topics as varied as his conversation with Australian Prime Minister Malcolm Turnbull, meetings with business leaders and anti-Trump protesters.

Yesterday, the Trump administration appeared poised to levy fresh sanctions on Iran in what would mark the first concrete evidence of the new president's tougher stance, hours after he and his national security advisor put Iran "on notice" over missile tests and support for Yemeni rebels.

The sanctions are likely to be levied on individuals or entities linked to Iran's missile program and will be taken under existing presidential powers, sources familiar with White House deliberations said.

The measures are likely to replicate actions by former president Barack Obama's administration, which targeted firms and the Revolutionary Guard's missile command after previous tests.

Asked by a reporter if military action was a possibility, Trump said, "Nothing is off the table."

On Wednesday, National Security Adviser Michael Flynn insisted the missile test was in defiance of UN Security Council Resolution 2231. That calls on Iran not to test missiles capable of delivering a nuclear weapon.

Iranian foreign ministry spokesman Bahram Ghasemi called the claims "baseless, repetitive and provocative."

Iran has confirmed that it had tested a ballistic missile, but denied that it violated the terms of the nuclear deal.

Tehran says its missiles do not breach UN resolutions because they are for defence purposes only and not designed to carry nuclear warheads.